While Intertainment Media Inc. (TSX-V: INT.V) has shown the ability to push their share price north at times, the “technology incubator” that invests in technology solutions for brands and consumers has found it difficult to sustain any advancement much to the frustration and displeasure of investors. It was just two weeks ago that we covered INT.V last and at that time shares were in the process of rebounding from a low of 0.360 set on May 22, 2012. Well INT.V did rebound, pushing to a high of 0.465 on June 11, 2012, the same day they announced that they had “developed, together with leading financial services industry partners, a customized social media financial services program for celebrities and socially active specialty brands.”
Unfortunately for shareholders INT.V has already seen most of those gains disappear, dropping down to a low of 0.390 on Friday, which happens to be the level they are trading at right now. So what has changed since Monday? Why has the enthusiasm that existed on Monday waned by Friday?
Looking at INT.V’s release on Monday this platform, dubbed “sweet card,” will be customized for celebrities “allowing them to engage with fans through a unique socially powered global fan loyalty and appreciation program. This program will utilize a unique mobile wallet payment application and customized debit VISA or MasterCard allowing users to earn exclusive rewards through virtual payments, online purchases, money transfers and conventional in-store transactions.”
According to INT.V they, along with their subsidiary Ortsbo Inc., have placed the program before “a number of leading talent agencies, artist management groups and merchandise partners” and are now ready to begin market testing with “key celebrities and specialty brands in North America with a view towards rapid global expansion opportunities.” From this program INT.V has said they expect to generate ongoing loyalty and transactional fees of which they, along with their divisions, will be entitled to up to 50% of net generated revenues.
For some investors INT.V’s outlook appears a bit too optimistic and this could cause some to stay clear of investing. There has been little follow up provided by INT.V related to their intended spin-off of Ortsbo Inc., something that many shareholders have been anticipating for awhile.
According to INT.V’s May 23, 2012 press release they continue to receive feedback from Canadian regulators on its proposed financing and senior listing and they have received interest from US investment banking firms for listing both Intertainment and Ortsbo on senior US exchanges.
The growth of Ortsbo, whose flagship product for social media supports global communications with instant translation capability and real-time, multi-lingual social media chat, has certainly been impressive as they have said they now have over 162 million unique monthly users, a spike of over 55 million users in the past 90 days, and they say they are moving towards “sustainable revenue with defined commercial opportunities in social media, broadcast communications, global customer care and ecommerce programs with major brand partners.”
Ortsbo has already run events with Disney, Dreamworks, Marvel, KISS, IndyCar, Clear Channel, Variety, Fox, Yahoo!, MSN and other major brand partners, all of which have utilized the company’s proprietary technology offerings that enable real-time multi-language interaction. By removing language barriers these technologies make it possible for commercial enterprises to engage consumers and clients providing solutions to increase awareness, revenue and profitability on a global basis.
INT.V has also pointed out that recent changes to the US Federal Communications Commission’s regulations with respect to accessibility through closed captioning and online intellectual property have “opened up a number of opportunities with major entertainment studios.”
Ortsbo has already engaged Cameron Thomson, “the pre-eminent provider of outsourced business development solutions for the media and entertainment technology sectors,” to provide sales and business development of Ortsbo’s commercial and entertainment programs in Europe and will also assist with business development solutions in select markets in North American, South American and Asia.
Adding further value to Ortsbo’s offerings is their ownership stake in Lexifone Communications Systems (2010) Ltd., a developer of proprietary voice translation technology systems. While INT.V completed the acquisition of that stake they immediately transferred that ownership to Ortsbo as it expands on its current technologies that provide real-time email, online chat and social media language translation. INT.V has stated in the April 27, 2012 announcement “The combined Ortsbo/Lexifone platform is expected to have broad applications in many industries including healthcare, emergency services, social services, travel, and other instances where real-time, vocal translation is preferable over text or chat.”
In the words of said David Lucatch, CEO of Intertainment and CEO of Ortsbo, “By combining Lexifone’s voice-to-voice technology with our portfolio of language transformation products and other intellectual property, we can create a host of new customer services that let people communicate across different languages in a clear, conversational experience.”
It would seem that Ortsbo is currently carrying all the value for INT.V and the potential that exists on a number of platforms could be very impressive but whether or not this “sweet card” platform is the ideal format for the technology Ortsbo is debatable. INT.V needs to start producing not just press releases that can kick the share price higher for a day or two but actually concrete advancements that will sustain the share price when it does spike.